Volvo has announced they will introduce only fully electric or hybrid battery and combustion cars as of the 2019 model year. This means the Chinese-owned Volvo is beginning to phase out their combustion only line up by next year. Volvo has previously vowed to sell 1 million electric and hybrid vehicles a year by 2025. However, the early phase out of combustion for the manufacturer was shocking even to industry experts. Volvo's announcement will have a massive impact on the auto industry. This shows the full commitment of an auto manufacturer of shifting from combustion to electric. Their stance will escalate the commercial and geopolitical contest to dominate the emerging electric car market. And it also serves as a warning for those still in denial and skeptical about electric vehicles being the future of transportation.
Major oil companies continue to doubt the combustion engine being dethroned by electric powered vehicles. They forecast pure electric vehicles holding single digit percentage of the new car market as far as 2040, mostly due to the cost of the electric vehicle. However, other industry experts predicts that by 2040, electric vehicles will account for over a third of all new car sales. Their research shows electric vehicles will soon reach cost parity with conventional vehicles within the next decade. Electric vehicles currently enjoy many government sponsored subsidies, and there are also privately funded subsidies available in certain regions. While the costs of combustion vehicles are currently on the rise due to many countries' emission regulations tightening their grip on pollution.
Eventually, the only way to lower emissions is to lose more weight on the vehicle, and after a certain amount of weight, more expensive but lighter and durable materials need to be used to replace parts in order to lose the weight without losing the structural integrity and safety of the vehicle. Volvo will be launching five fully electric vehicles between 2019 through 2021. Three will be new Volvo models and two high performance electrics will belong to Polestar, the performance arm of Volvo. The XC60 and XC40 are combustion engine vehicles due to be launched before 2019. These models will live out their life cycle in petrol and diesel, which is typically around seven years for any model. Volvo currently is owned by Geely, a Chinese company. The country itself has been leading the charge for electric cars with many government sponsored subsidies. Among electric rivals, Volvo will have to compete with Nissan, Renault, BMW, Volkswagen and Tesla.